Vanguard Health Systems' IPO brings $450M

(AP) — Hospital operator Vanguard Health Systems Inc. said Wednesday it raised $450 million in an initial public offering of 25 million shares priced below the range it expected.

The Nashville, Tenn., company — which owns four hospitals in Illinois, according to its website — said it priced the shares at $18 each, and they were expected to begin trading Wednesday on the New York Stock Exchange under the ticker symbol "VHS." Vanguard had said in documents filed with the Securities and Exchange Commission before the offering that it anticipated pricing the shares between $21 and $23.

It also said in the filings it expected net proceeds of $511.6 million after deducting underwriting discounts, commissions and other expenses.

Vanguard owns and runs a total of 26 acute care and specialty hospitals here and in Phoenix, San Antonio, Detroit and Massachusetts. Its website lists is local facilities as MacNeal Hospital, Weiss Memorial Hospital, Westlake Hospital and West Suburban Hospital.

It also runs outpatient facilities and related businesses, and it operates three managed care plans in Arizona and Illinois that serve about 242,000 people.

Earlier this year, it bought the nonprofit Detroit Medical Center for $368.1 million in cash and committed to capital spending of $850 million there over the next five years.

The company will use net proceeds from the offering mostly to redeem 10.375 percent senior discount notes due in 2016.

Vanguard also granted underwriters a 30-day option to buy up to an additional 3.75 million shares to cover any excess demand.